BOSTON (CBS) – While researching this segment I read 30 articles on credit card debt and the college student. My conclusion, most kids still have problems using credit cards in college.

Credit card companies can no longer easily sign a kid up for a credit card. If the student is under 21 they will need someone to co-sign the card or prove they have an income stream to pay their bills.

But kids are still getting the hard sell and the focus is on getting mom and dad to co-sign. And they succumb, 20% of 18-year-olds hold four or more credit cards.

They have accumulated on average over $3,000 of credit card debt. This is not debt because of tuition or books, but debt due to the late night pizza runs, the concerts, the clothes.

Seventy-six percent of undergraduates hold at least one credit card and half have at least four cards and most maintain a balance thus incurring finance charges each month. Add that to the average school loan debt of over $33,000 and you have a kid who is on the brink of disaster at graduation.

So just like the SEX lecture you need to sit your kids down and talk to them about CREDIT.

Here are some of the basics to cover:

  • Credit is not “free” money and it must be paid back
  • The credit card companies make money by charging the retailer a fee to participate
  • The credit card company may charge an annual fee for your card
  • The credit card company charges interest if the balance is not paid in full each month
  • The credit card company charges a fee if the payment is late and can increase the interest rate
  • Paying only the minimum each month can drag payments out for many years
  • A bad credit report will follow you. A potential landlord or employer and insurance companies as well as lenders have access to your credit report. Poor credit can mess up renting a place, getting a new job as well as costing a higher car insurance rate.
  • Credit History is important. You can get a free credit history annually at
  • Credit scores are important. has lots of good information along with
  • Debit cards may be a good training card for teens; they can only spend what’s in the account and no more!
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